Redefining Saudi Arabia’s Dependence on Oil

Instability in the Middle East and the current decline in oil prices have forced oil-led countries to reevaluate their economic models. Saudi Arabia has seemingly enjoyed long periods of prosperity, but it has come with costs both hidden and obvious. Economic terms such as “resource curse,” and “Dutch disease,” are generally applied to the economic reality Saudi Arabia faces, but a central question emerges: which is the best way forward for one of the United States most consistent Middle East partners to assure Saudi Arabia’s economic viability? Five scholarly journals are examined and policy prescriptions are discussed: Karl (2007) suggests prosecuting corruption; Ross (2001) suggests reforming governmental policies that hinder efficiency; Hamid (2014) suggests promoting gender equity in financial transactions, as well as promoting tourism and agriculture; Gylfason (2001) suggests advancing education reforms; and Hausmann and Rigobon (2002) suggest diversification of Saudi Arabia’s national economy.

Of the Middle Eastern countries that export oil around the world, no country has a more paradoxical relationship with its primary economic resource than Saudi Arabia. Many westerners I have met presume, based on its economic history during the 20th century, that Saudi Arabia is a rich country, of virtually unlimited resources, with very few internal social conflicts or economic restraints. However, this presumption is quickly revised when the historical data of corruption, slow growth, gender bias, a foundering education system, and a lack of diversification are examined. Redefining Saudi Arabia’s Dependence on Oil

Karl (2007) points out that states with the greatest resource reserves, especially oil-exporting countries, have…...

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The Kingdom of Saudi Arabia is the largest country in the Arabian Peninsula. Saudi Arabia’s population is 27 million, including 8.4 million foreign residents (2010 census), and its capital city is Riyadh. Saudi Arabia’s geography is diverse, with forests, grasslands, mountain ranges and deserts. The climate varies from region to region. Temperatures can reach over 110 degrees Fahrenheit in the desert in the summer, while in the winter temperatures in the north and central parts of the country can drop below freezing. Saudi Arabia gets very little rain, only about four inches a year on average.
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Economy in Saudi Arabia
Saudi Arabia is the largest Arabian Country which is located in southwest Asia. It clenches the largest free market economy in the Middle East and North Africa. The geographic setting of Saudi Arabia provides an easy entrée to export the markets of Europe, Asia, and Africa. Saudi Arabia is an oil-based economy with a robust government control over the main economic activities; it approximately holds 17% of the worlds established petroleum assets. Saudi Arabia grades the largest exporter of petroleum, and plays a primary role in OPEC. The petroleum sector alone interprets for roughly 45% of GDP, 80% of budget revenues, and 90% of export earnings.
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Population | 26,939,583 includes 5,576,076 non-nationals |
Dependency Ratio | total dependency ratio: 46.9 %
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elderly dependency ratio: 4.2 %
potential support ratio: 23.6 |
Population Growth Rate | 1.51% |
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Water | 7 |
Water Desalination | 7 |
World’s Largest Solar Powered Desalination Plant | 8 |
Al- Midra Tower | 9 |
Conclusion | 11 |
References | 12 |
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Appendix 1.2 16
Appendix 1.3 17
Company Background
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Economic Success
Saudi......